* Help for Greece could reach $29 billion - official
* U.S. jobless claims fell sharply last week
* Coming Up: U.S. GDP final estimate for Q4, 1230 GMT
(Updates prices, adds background)
By Alejandro Barbajosa
SINGAPORE, March 26 (Reuters) - Oil climbed towards $81 on
Friday after an agreement to create a safety net for
debt-ridden Greece helped restore confidence among investors to
buy riskier assets, including commodities.
The euro rebounded from 10-month lows after euro zone
leaders together with the International Monetary Fund on
Thursday agreed to provide Greece with coordinated bilateral
loans if the Mediterranean nation faced severe difficulties.
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U.S. crude for May delivery <CLc1> rose for the first time
in three days, gaining 37 cents to $80.90 a barrel at 0615 GMT,
while ICE Brent <LCOc1> climbed 37 cents to $79.98 in London.
Japan's Nikkei average hit an 18-month high on Friday,
while a day earlier the Dow and S&P 500 jumped to similar
milestones following a report showing the number of U.S.
workers filing for jobless aid fell sharply last week.
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"The initial jobless claims was a very encouraging sign,"
said Clarence Chu, an energy trader at Hudson Capital Energy in
Singapore. "If the number of unemployed people drops, it will
be a big boost for oil."
"And if something really concrete comes out of Greece, and
people forget about Europe's problems and the dollar comes back
down, then oil could march higher," Chu said, adding that for
now he expects prices to trade between $80 and $83.50.
The European-IMF agreement for Greece included no numbers,
but a senior European Commission source said the support
package would be worth 20-22 billion euros ($27-29 billion) if
required in an emergency. []
"Most people think the bailout is a done deal, but I think
it is still in the air," Chu said. "The IMF has had to step in
because they can't agree on one thing."
WEAK FUNDAMENTALS
Oil prices were, however, little changed from last Friday
as a larger-than-expected increase in U.S. crude inventories
offset declining stockpiles of gasoline and distillates.
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Investors have mostly focused on currency movements and the
speed of economic recovery as a cue for commodity price
movements this week. Gold also rose today as the euro
rebounded.
U.S. oil demand grew 3.6 percent last week. But demand in
Europe weakened sharply in January, down by 1.55 million
barrels per day from a year earlier, Barclays Capital said
earlier this week, citing data published by the Joint Oil Data
Initiative.
"The whole demand picture is not that strong," Hudson's Chu
said. "It has improved from a year ago, but it is still very
weak."
Oil inventories at Cushing, Oklahoma, the key U.S. crude
oil hub, rose by 754,739 barrels to 31.8 million barrels in the
week to March 23, according to a report from energy industry
data provider Genscape released on Thursday. []
"Fundamentals really don't support prices at these levels,"
Chu said. "But the whole feeling is that oil is very resilient,
and it doesn't want to go lower."
(Editing by Michael Urquhart, Himani Sarkar)
